Gerard Arpey’s eight-year effort to keep AMR Corp. out of bankruptcy ended with his retirement as a board decision to seek court protection threatened to erode his credibility, people familiar with the matter said.
American Airlines parent AMR Corp. filed for bankruptcy after failing to secure cost-cutting labor agreements and sitting out a round of mergers that dropped it from the world’s largest airline to No. 3 in the U.S.
American Airlines executives began considering a bankruptcy filing in August and were joined by parent AMR Corp.’s board in October as the carrier prepared a 2012 business plan, people familiar with the matter said.
AMR Corp. Chief Executive Officer Gerard Arpey kept a secret in April as analysts questioned why his turnaround strategies haven’t produced an annual profit at the parent of American Airlines since 2007.
AMR Corp. Chief Executive Officer Tom Horton kept pitching himself to be CEO in a merger with US Airways Group Inc. until the end of January, when his bankruptcy creditors firmly said no, people familiar with the matter said.
American Airlines , which stood by as its biggest U.S. rivals completed two mergers, is struggling to return to profit as it confronts the highest costs among its peers, worst margins and the threat of a strike.
AMR Corp.’s American Airlines, whose bankruptcy made it a possible takeover target, may try to buy a rival after leaving Chapter 11 as the U.S. industry shrinks, Chief Executive Officer Tom Horton said.
United Continental Holdings Inc. , Delta Air Lines Inc. and rival U.S. carriers added a record $420 in fuel surcharges to round-trip European fares as soaring oil prices propelled first-quarter losses.